Tuesday, 30 September 2014

UK Sectoral Balances - Q2 2014

Today's Quarterly figures represent a complete review of the National Accounts framework in the UK to bring it up to the latest European Standards - ESA10. There have been quite a few alterations to the structure which have altered the net-lending positions of the sectors. The main one is the alteration to the pension accounting which is now on an actuarial basis and alters the position between the household sector and the finance sector a bit. The private debt calculations I usually put out will need checking first to make sure I've still got everything in there after the reclassification. Hopefully I'll be able to work that out and publish them soon.

Additionally the figures are now only available from the beginning of 1997.

What is interesting now is that the government balance pretty much exactly equals the Rest of the World balance. The domestic sectors are all about balanced - within the error bar - as we can see from the five sector chart.
So for anybody to 'get the deficit down' from this point requires either a significant adjustment to the external balance, or one of the domestic sectors going deeper into debt.

Right at the moment we effectively have a domestic 'balanced budget'.

Source: Office of National Statistics, tables RPYH, RQAJ, RQBN, RQBV, RPYN, RPZT, RQCH, DJDS (Seasonally adjusted Net Lending/Borrowing per sector plus residual error) and YBHA (Gross domestic product at market prices, seasonally adjusted).